Geely Holding Group's premium electric vehicle (EV) subsidiary, Zeekr, is gearing up for a planned initial public offering (IPO) in the United States with an ambitious target—a valuation of $18 billion. This valuation has caught the attention of investors and is higher than anticipated, according to a report in local media outlet Jiemian.
Zeekr's discussions have primarily focused on attracting overseas investors, with no talks yet conducted with mainland Chinese and Hong Kong-based investors. The company has engaged in preliminary conversations with institutional investors in Singapore and Europe.
The proposed $18 billion valuation places Zeekr on par with Nio's current market capitalization of $18.3 billion. This valuation exceeds expectations and even surpasses Xpeng's recent market capitalization of $15.8 billion, which had received investment from Volkswagen.
While Zeekr is initially seeking this high valuation, there is room for negotiation and potential downward adjustments as the company advances in its communications with investors.
Geely Holding Group announced on December 13, 2022, that Zeekr had confidentially filed a draft registration statement for a possible IPO with the U.S. Securities and Exchange Commission. In February of the following year, Zeekr secured $750 million in Series A funding from five investors, resulting in a valuation of $13 billion.
Zeekr has ambitious goals, aiming to achieve annual sales of 650,000 units by 2025 and aspire to be among the top three premium EV market players globally.
While Zeekr seeks to move forward with its IPO plans amid a potentially cooler U.S. stock market environment for EV companies, factors such as its access to Geely's Sustainable Experience Architecture (SEA) structure and support from strategic investor CATL will influence its ultimate valuation, according to Gui Lingfeng, a director at consulting firm Kearney.
Although postponing the IPO for one to two years could increase the likelihood of securing a larger funding amount and valuation, Zeekr is currently pressing ahead with its intention to list in the U.S. Zeekr has filed an overseas listing application with the China Securities Regulatory Commission and intends to issue up to 926,074,300 shares on the New York Stock Exchange. The company is committed to providing updates on the listing if it does not complete the foreign listing within 12 months, as per regulatory requirements.